Appraisal News and Business Tips

10-26-17 Newz//Haunted homes and Places, Liability Issues, Tax Savings

Haunted houses and places – Halloween is next Tuesday.

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Google Maps Listed The 31 Most Haunted Places In America And They Sound Terrifying
From cemeteries and churches to mansions and museums.
Here are a few:
13. Adam’s Street Cemetery – South Bend, Indiana
16. Eastern State Penitentiary – Philadelphia, Pennsylvania
26. The Stanley Hotel – Estes Park, Colorado
My comment: Photos, brief writeup and links. Most are east of Kansas. Only a few near me. Not sure what that means ;>
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38 Real Haunted Houses and the Stories behind Them
Here are a few:
4. The White House, Washington DC
8. The Pirate’s House, Savannah, Georgia
10. Lizzie Borden House, Fall River, Massachusetts
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Haunted House? Not a Deal Breaker for Many Homebuyers

Excerpt: According to the Haunted House Real Estate Survey realtor.com® released today, 33 percent of approximately 1,000 respondents said they are open to living in a haunted house, 25 percent might be, and 42 percent are not open to the idea.

About 40 percent of people who are open to a haunted home said they’d want to see that home price go down to put money down on it. Another 35 percent said it would have to be in a better neighborhood to make the move, 32 percent said they wanted extra footage and 29 percent said they’d move in if they had more bedrooms.

Only 8 percent of respondents said they require no additional perks to purchase a haunted home. Basically, they wouldn’t hesitate and would move right in.

What about if someone died in the house? Actually, 47 percent of those surveyed said they would live in a home where someone died, 27 percent said they might, and 26 percent said, “NO WAY.”

My comment: Very interesting results. What is the effect on value, if any. Up, down, none?? Maybe someone will pay me some big bucks sometime to figure it out…

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From Ghost Hunters to Exorcists: Who You Gonna Call for a Haunted House?

Excerpt: Shortly after physical therapist Sally Morgan moved into her charming, late-19th-century cottage in Northampton, MA, she realized that she and her two pet corgis were not alone.

The price of the two-bedroom fixer-upper had seemed almost too good to be true. She soon discovered why she had gotten a bargain.

“Within a week, I started to feel a presence in the house. There were cold spots, and the dogs would stop and look at [invisible] things,” says Morgan, now 59. “In the shadows in the evenings, you’d think you saw a lady in a long dress. But was it her? Was it the curtains? Was it the shadows?”
My comment: Very interesting – who are you gonna call???
 
Search for haunted homes and places in your city. I found some in mine!! 

Mortgage origination forecasts for 2018

Excerpt: MBA said it expects to see a year-over-year decline from $1.69 trillion in 2017 to $1.60 trillion (5.3%).

Freddie Mac’s bottom line is quite similar, a total of  just under $1.70 trillion next year, but they see a much higher total for 2017, 1.80 trillion, and thus a sharper drop (5.5%). Fannie Mae forecasts the total for this year at $1.79 trillion, declining to 1.72 trillion next year (4% decline).

For 2019, MBA is forecasting total originations to rebound to $1.64 trillion, based on an increase in purchase originations to $1.24 trillion while refinancing declines further to a volume of $395 billion (2.5% increase).
My comment: Of course, no one knows what will happen, but the forecasts indicate that economists see a relatively small percentage decline as compared with the “bad years” after 2008.
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2017 year-end tax planning for appraisers

How you can save money on your 2017 taxes!!

Coming in the November 2017 issue of the paid Appraisal Today, Available 11/1/17
Excerpts: 

The goal is to reduce taxes by deferring (or occasionally, accelerating) income to a year in which you are (or may be) in a lower tax bracket to take advantage of tax credits and deductible expenses. You can earn income tax-free through retirement accounts – SEP-IRA, Solo 402k, etc.), often your best option for reducing your 2017 taxes.

Topics covered include:
– How to defer income.
– How to increase expenses by timing payments, such as pre-paying property taxes or Quarter1 2018 estimated IRS taxes.
– Expenses (and donations) done by 12/31/17 are deductible. Credit cards can be useful as they are immediately charged if you procrastinate. 
– How and when to set up  a retirement account to defer taxes. How much money you can contribute tax-free. 
To read the full article, plus 2+ years of previous issues, subscribe to the paid Appraisal Today.
 
If this article saved you at least $100 in taxes, it is worth the subscription price!! 

$8.25 per month, $24.75 per quarter, $89 per year (Best Buy)  
or $99 per year or $169 for two years 
Subscribers get, FREE: past 18+ months of past newsletters 
To purchase the paid Appraisal Today newsletter go to
www.appraisaltoday.com/products   or call 800-839-0227. 
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If you are a paid subscriber and did not get the October 2017 issue, emailed October 3, 2017, please send an email to info@appraisaltoday.com  and we will send it to you!! Or, hit the reply button. Be sure to put in a comment requesting it.

Is it okay to use comps from a different city?

Excerpts: Can you use comps from a different city? Most of the time that’s a bad idea, but sometimes it’s the best option. Let talk about this a bit as I share an example of why I did this recently in an appraisal. The discussion below really has to do with school district boundaries too. Anything to add? I’d love to hear your take.

Remember, it’s never about how far an appraiser can go, but where an appraiser should go for comps.
My comment: Read the full blog post to see all the graphs, etc. plus read appraiser comments and post your own comment. I seldom go to other cities for comps (typically a property with an unusual feature), but appraisers who specialize in high end homes often do. Of course, I often go to other cities for commercial and large apartment properties.

Risky Business – Appraiser Liability

By Peter Christensen, www.liability.com 
Excerpt: As compared to a few years ago, on a national basis the number of disciplinary (state board) complaints against appraisers is way down. Complaints, however, continue to come most commonly from borrowers contending the appraisals for current loans they want are too low (that doesn’t stop borrowers from later claiming the appraisal was too high when they can’t afford the mortgage and are underwater). Most of these borrower complaints don’t go anywhere but they still cause heartache for appraisers.

Unfortunately, what we are seeing very lately is that because appraisers have been very busy with a high volume of recent refinance work, some appraisers have let their standards slip a bit in a rush to complete reports. When this kind of rough shod, poorly supported work gets before a state licensing board, that’s where we see actual discipline most often occurring, with the most common real problems involving inaccurate observations about the subject property (square footage, condition or other attributes), relying on third party information about the property without verification, and poorly selected or adjusted comparable sales.

My comment: This blog post is worth reading. Peter Christensen has been my “go to” person for appraiser liability issues for a long time. He is a good speaker and travels around the country giving workshops for appraisers, with CE credit when available. I have obtained my liability insurance from Liability Insurance Administrators since 1990. www.liability.com

Peter has an article on liability when doing estate/trust appraisals for the November issue of the paid Appraisal Today which includes sample disclaimers, which we all like. 
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HOW TO USE THE NUMBERS BELOW. Appraisals are ordered after the loan application. These numbers tell you the future for the next few weeks. For more information on how they are compiled, go to www.mbaa.org 
Note: I publish a graph of this data every month in my paid monthly newsletter, Appraisal Today. For more information or get a FREE sample issue go to https://www.appraisaltoday.com/products.htm or send an email to info@appraisaltoday.com . Or call 800-839-0227, MTW 7AM to noon, Pacific time.

Mortgage applications decreased 4.6 percent from one week earlier

WASHINGTON, D.C. (January 30, 2015) – WASHINGTON, D.C. (October 25, 2017) – Mortgage applications decreased 4.6 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 20, 2017. The previous week’s results included an adjustment for the Columbus Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 6 percent compared with the previous week. The Refinance Index decreased 3 percent from the previous week. The seasonally adjusted Purchase Index decreased 6 percent from one week earlier. The unadjusted Purchase Index increased 4 percent compared with the previous week and was 10 percent higher than the same week one year ago.

The refinance share of mortgage activity increased to 49.5 percent of total applications from 48.6 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.4 percent of total applications.

The FHA share of total applications decreased to 9.8 percent from 10.4 percent the week prior. The VA share of total applications decreased to 10.1 percent from 10.5 percent the week prior. The USDA share of total applications decreased to 0.7 percent from 0.8 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) increased to 4.18 percent from 4.14 percent, with points decreasing to 0.42 from 0.44 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) decreased to 4.11 percent from 4.13 percent, with points decreasing to 0.24 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.04 percent from 4.00 percent, with points increasing to 0.41 from 0.37 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.48 percent from 3.45 percent, with points decreasing to 0.40 from 0.43 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.29 percent from 3.31 percent, with points increasing to 0.54 from 0.40 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.

Mortgage Bankers Association
1919 M Street NW, 5th floor
Washington, DC 20036
(202) 557-2700 (800) 793-6222
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